C-Cell Wireless needed additional capital to expand, so the business incorporated. The charter from the state of Georgia authorizes C-Cell to issue 50,000 shares of 7%, $50 par value cumulative preferred stock and 120,000 shares of $2 par value common stock. During the first month, C-Cell completed the following transactions:
Oct. 2 Issued 22,000 shares of common stock for a building with a market value of $120,000.
6 Issued 900 shares of preferred stock for $70 per share.
9 Issued 12,000 shares of common stock for cash of $60,000.
10 Declared a $16,000 cash dividend for stockholders of record on Oct. 20. Use a separate Dividends Payable account for preferred and common stock.
25 Paid the cash dividend.
Requirements
1. Record the transactions in the general journal.
2. Prepare the stockholders’ equity section of C-CelPs balance sheet at October 31, 2016. Assume C-Cell’s net income for the month was $96,000.